NEW DELHI: Highly addressable advertising has been
a long-standing plan for the TV business, which wants
to rival the ad targeting available online, and the
biggest beneficiary of addressable commercials so far
may be the TV industry itself even as marketers want
to make their spending more efficient.
Cable networks like Starz and HBO have begun trying
DirecTV's addressable advertising platform to find specific
viewers who they believe would actually be interested
in their shows. Cable and satellite operators, meanwhile,
are taking advantage of the system to more efficiently
target specific customers and get current subscribers
Such advertising could be most effective for the actual
TV operators, said Visible World executive VP- marketing
and research Claudio Marcus. Visible world provides
targeting technology to Cablevision.
According to the National Association of Broadcasters
of the United States, this is partly because paid TV
services do not want to waste sign-up ads on people
who already shell out for the product. Other kinds of
marketers have a greater interest in marketing to current
customers, so they'll stick with the brand for their
next box of crackers or new smartphone.
It can also be laborious to match specific households
with the cars or packaged goods they buy but pay-TV
operators like DirecTV know exactly which premium channels
each of its households pays for.
"People are telling us they have enough TV,"
said Media Storm co-founder and managing partner Craig
Woerz. Media Storm's clients including WeTV and NFL
Network use DirecTV's addressable advertising. "We
need to make it more personalised and break through
the clutter. We don't want to break through with everyone,
just the right people, who will be highly engaged."
"Clients using addressable advertising are seeing
a 20-40 per cent higher tune in rate than those not
doing it," informed Woerz.
Addressable commercials let you plan a TV campaign
the way you would plan digital, said Starz exec VP-marketing
Nancy McGee, which has run two campaigns using DirecTV's
addressable system. "Addressable makes sense in
light of how people are consuming TV, cherry-picking
programming and networks," she said.
The premium cable channel tested a small campaign in
March, urging viewers to add Starz, and followed up
in June with a promotion for the premiere of the second
season of "Magic City."
In the initial test, which ran over five days, Starz
showed ads to non-subscribers who frequently bought
movies on demand or who subscribed to other premium
channels, groups that the network believed had a higher
propensity to be won over.
The network saw a 49 per cent higher jump in sales
among viewers who saw the ads than in a control group,
McGee said, adding that the system provides information
on how many people were exposed to the campaign, how
many watched it live and in playback, on which network
they saw it and during which part of the day.
HBO, too, has used the DirecTV system for a campaign
pegged to Game of Thrones, showing commercials to consumers
who met criteria such as frequent VOD orders, on the
same logic that Starz applied. It will run a similar
effort later this year for the return of Boardwalk Empire.
HBO is still learning, according to HBO director, domestic
network distribution Gina DeSantis. But the network
intends to increase its investment in addressable ads
next year, she said.
Scripps Networks is early in its exploration of addressable
advertising, using it to send programming messages to
viewers based on geographic location, said VP, national
accounts, content and marketing group Brent Scott.
"There are so many shows and competitive networks,
if you can pinpoint a specific customer you have a better
chance of tune in," he said. "Why advertise
to DirecTV's entire customer base of 20 million if 19
million of those have no interest. I'd rather reach
a couple of hundred thousand that are interested."
"In a lot of ways what we are doing here is no
different than what Spotify is doing, what Amazon has
been doing for years," said DirecTV exec VP- chief
revenue and marketing officer Paul Guyardo. "They
see what you like to purchase, they see the songs you
like to listen to, and they serve up songs they think
you might be interested in. We are only putting the
commercials in homes of people that want to know more
about new cars or a premiere of a particular show because
it is a show they like to watch."
Auto, insurance and financial marketers have also been
using the addressable technology, according to Guyardo,
but the limits of the pay-TV systems' reach have held
back widespread adoption.
Some in the TV business also worry about the impact
of easy, highly targeted TV commercials. "There's
a fear factor," said Marcus. "The concern
is if media buys become more efficient, does money come
out of the marketplace because advertisers can do more
But the biggest challenge is educating the marketplace,
with many media buyers and planners still thinking in
traditional gross rating points, according to Guyardo.
DirecTV is trying to overcome that by pitching directly
to CMOs, especially those who are data-driven. "If
they value and appreciate data and analytics and they
have a good understanding of exactly who they want to
target, the beauty of this addressable product is it
provides all of the reach that they want without the
waste," Guyardo said.